Seems we are entering the "warning" season a little early this time around. The technology stocks are going to be dangerous overnight holds from here to earnings season, unless the companies come out with positive guidance.
The market internals were mixed to negative, not as bad as I had been expecting after watching the market slide most of the day. The screened stock ratio was a wash at 2.5 to 2.4. This puts us back to moderate risk. The market looks to be negative at the open today, since we have had weeks of a positive market, I would be surprised to see a turn around today, but you never know. We have a situation where both the market internals and the screened stock ratio are still positive, yet weakening. So while caution may be warranted, "lite" mode is not yet. I'd just keep with the stronger groups, but keep an eye on the exit since a truly negative market will bring down the majority of stocks.
Biotechs, including drugs and medical equipment type stocks, continue to dominate the screening. We may have too many biotechs on the watchlist, but frankly, it was hard to find something to replace these stocks with. Over the last few months there would always be energy stocks coming in when others were down, but this time around the energy stocks are nowhere to be found. And one, DYN, that we have recently had a few good long positions with, showed up the last two days on a short screening, and the insiders have been selling heavily.
Long: ADRX, AL, AMLN, AZO, GETY, GLC, LUV, NBTY, STJ and SWC.
Good Trading!!
Sam
savvy-trader.com |
